What is PayPal currency conversion fee

What is PayPal currency conversion fee?

PayPal is one of the best known and most widely used payment services for transactions over the internet. Although it is a straightforward service to use, few are the users who know the different fees that PayPal applies.

This text will focus on evaluating What is PayPal currency conversion fee? And how much PayPal charges for the currency exchange, as well as other expenses related to sending money nationally and internationally.

PayPal currency exchange: What is PayPal currency conversion fee?

PayPal has a camouflaged method to charge you even more commission and that most overlook, the worst thing is that sometimes it does not give you the option to avoid it. However, we will explain what it is and how you can prevent a little more each time that you send money payments electronic payments with PayPal, where you have to use your card and buy currency from another country different from yours.

The exchange rate is the difference between the value of two currencies, that is, the amount necessary for one money to buy a different one, something that is essential when you need to convert between two given currencies.

The exchange rate used as a reference by entities around the world is the so-called average exchange rate, a value traded in large markets that depends on supply and demand and is considered the fairest possible.

In general, PayPal does not apply the average exchange rate but uses its exchange rate with a surcharge that moves away from this exchange rate, which can cause it to become significantly more expensive to send money abroad.

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Fees for PayPal currency exchange

In addition to the possible price for the difference with the average exchange rate, PayPal will charge a commission for currency exchange that will typically vary between 3 and 4% for the vast majority of payments and currencies. This percentage for currency conversion means that sending or paying with this service has a high cost due to PayPal’s commission for currency exchange.

As anyone who wants to know how much PayPal charges for currency exchange can see, the cheapest way is to convert to US or Canadian dollars, since a commission of 3% will be applied, which contrasts with 3.5% for conversions to pounds or euros and 4% of the Japanese yen or the Mexican peso.

In any case, an option to get a lower commission is to convert the money from your account balance to the currency to be saved instead of letting PayPal do it automatically since, in that case, the commission percentage will be 2.5% for all currencies.

Avoid fees for currency conversion in PayPal

PayPal currency conversion rates can be unfavorable if you do not take them into account. We know that PayPal is a great payment platform for buyers since they get the assurance that if something goes wrong, they can start a claim and get their money back. It is the main reason why it is the preferred payment method around the world.

But unfortunately, the service can become very expensive. If we do not take into account certain basic principles when using it, such as allowing PayPal to perform the currency conversion for us instead of our bank, which will probably offer us much more favorable exchange rates.

• The first step, assuming you are logged into your account, is to look for the gear icon (options) that is located on the upper right and click on it.

• When you are there, you need to click on the Payments tab

• The first option you will find is ” Manage automatic payments. ” In that section, you must click on the button ” Manage payment methods ” located in the lower-left corner.

• You will find a classic view page, where you can manage subscription payments, and you can also ” Set available payment methods ” on the right side.

• Below you can see the credit cards assigned to the account. You should go to Conversion Options for each card you want to configure.

• Once there, you only have to check the second option and click Send to complete the process. That will be it!

• From now on, the issuer of your card will decide what the exchange rate will be when making transactions in other currencies, ruling out the usurious rates that PayPal chooses by default. You must repeat the process for each card you have linked to your account.


Paypal makes more money by placing an unfavorable exchange rate instead of a better conversion that our bank can offer us. That is why they have not made this configuration accessible, requiring several additional steps. Imagine the difference they can make for you by processing millions of transactions between countries.

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